Waxman suggests SBI-Net contractor Booz Allen has conflict

Rep. Henry Waxman (D-Calif.) today suggested that consulting firm Booz Allen Hamilton Inc. may have a significant conflict of interest in its role as a contractor hired to help oversee the Homeland Security Department's $8 billion Secure Border Initiative Network surveillance system.

Waxman, chairman of the House Committee on Oversight and Government Reform, drew attention at a hearing for the DHS' heavy reliance on outside contractors in planning, managing, administering and overseeing the ambitious SBI-Net program.

The surveillance system is intended as a virtual fence of cameras, radar and sensors tied together in a network and linked with border patrol agents along the U.S. borders with Mexico and Canada. Aircraft maker Boeing Co. was awarded a contract for the initial segment in Arizona in September 2006.

In a memorandum released today in connection with the hearing, Waxman said Booz Allen, based in McLean, Va., 'appears to have significant conflicts of interest' by helping to oversee SBI-Net for the department at the same time Booz Allen is a subcontractor to Boeing on other projects.

As an example, Waxman listed Booz Allen's subcontracting relationship with Boeing for modeling and simulation capabilities for a subsystem of the Air Force Multi-Sensor Command and Control Aircraft program. In 2003, Boeing received a $4 million contract to define requirements for the subsystem.

Waxman also cited Booz Allen's ongoing relationship with Boeing since 1993 to assist Boeing in maintaining its market share in the airplane industry, and other extensive relationships with the aircraft manufacturer since 1970.

Waxman noted that Booz Allen's contracts with DHS are lucrative, noting that in fiscal 2005 the firm received contracts totaling $97 million from the department, while Mitre received $47 million; PMC, $22 million; and Robbins Gioia, $21 million.

However, Gregory Giddens, DHS' project manager for SBI-Net, said in his testimony today that private contractors have been hired for advice on SBI-Net but not for oversight.

'They are support. They are not providing oversight,' Giddens said of the contractors. Additionally, he said at the hearing, hiring sufficient government employees is a difficult task to accomplish in time to meet the project's schedule.

Waxman said in the memo that DHS is relying on private contractors to plan, award and manage the SBI-Net program. Of the 98 personnel assigned to the SBI-Net project office as of December 2006, 60 are identified as contractors.

While DHS projects a total of 270 personnel involved in oversight activities by the end of fiscal 2007, nearly 60 percent will be contractors, Waxman said.